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Today, more than ever independent recruiting and staffing firms are outsourcing the financial risk, liability and headache of running a comprehensive back office solution in house. Outsourcing your back office functions to a provider who specializes in running full back office EOR and payroll funding exclusively to recruiting and staffing firms allows you to focus on your core competency and therefore grow your bottom line.

So what do you need to know when doing your due diligence when comparing back office services and all the components involved? Below is a list of 17 crucial features to ensure you have the best back office solution for your recruiting and staffing firm:

• An instant online calculator so you can calculate your exact profit per hour in real time when negotiating with clients using a computer, smart phone or tablet.

• A best profit per hour guarantee to make sure you’re earning top dollar.

• Recruiter-centric. Your back office partner should consult with you before contacting your candidate and clients if there are any issues or questions.

• Featured branding. Your back office partner should focus on keeping your brand in front of your clients and candidates not their back office brand.

• The right back office should have 20+ years in the industry and be 100% exclusive to independent recruiting and staffing professionals.

• Recruiters should not be liable if their client does not pay the invoice.

• No long term contracts! Your back office partner should have to earn your business every week with every contractor or you should be able to look elsewhere.

• Your % fee should be 100% on the pay rate and not any part of the bill rate so you aren’t penalized for negotiating a better bill rate.

• The full back office solution should be 100% web based including online time cards, online forms, online agreements with digital signatures, direct deposits, online contractor on-boarding, weekly reports via email and more.

• Easy recruiter enrollment to get setup and running within 48 hours.

• Quick turn around with a New Assignment in one business day if needed.

• You should be assigned a dedicated account manager who will get to know your business and whom you can use as a one stop contact.

• No contractor minimums so you can run one or hundreds contractors.

• No pay rate minimums so you can run any pay rate amount as long as the bill rate covers the breakeven threshold.

• Cloud reporting so you can access your profit and aging reports 24/7.

Put simply; the above 17 features should be provided to you by your back office provider or you’re not getting what you deserve. Outsourcing to the right back office provider can deliver significant savings and an increase your gross profit. The time savings can be significant and free up resources that benefit your organization and customers.

There’s hardly ever been a better, or busier, time to be a recruiter in America. With a 16-year low unemployment rate and a record-high number of job openings, the demand for recruiting and staffing services is strong as this candidate driven market rolls on.

SIA just announced US staffing market predicted to grow 3% in 2018 to $126.8 billion. Total US staffing market — which includes temporary staffing as well as place and search — will rise by 3% both this year and in 2018, bringing total revenue in the industry to $145.1 billion next year, according to a new industry forecast by Staffing Industry Analysts. However, with a stronger recovery projected for place and search, the overall staffing market is likely to achieve 4% growth to reach $146.6 billion. Other positive economic factors include cutting the corporate business tax from 35% to 20%. “Despite the somewhat slower growth, the staffing market is on track to hit record size in terms of revenue in the next two years,” said Barry Asin, President of SIA. Online staffing will reach $5 billion in annual spend in 2018 from $1 billion in 2012.

Independent recruiting and staffing firms need to be prepared for the temp/contract staffing boom. If you’re not running contract/temp in your business then you need to add it to your services so you can become a full service recruiting firm for your client base and substantially increase revenue. If you’re already running both contracting and direct hire, make sure your you’ve partnered with a full service single solution back office provider who guarantees the highest profit per hour, features your brand on all forms and client and candidate communications as well as provides extensive value added services to help your business grow.

“Contracting,” “contract to hire” or “contract to permanent” placement scenarios are terms that are being spoken about more and more in today’s marketplace and it’s time to get familiar with it because it’s not going away. Often times, contract to hire is pushed by many recruiting agencies because it can be more profitable than simply placing someone directly with the company and charging a percentage of their salary.

Contract staffing opportunities exist in all verticals from entry level positions, management to executive level jobs. If you think temp/contracting is only for admin or warehouse jobs then you need to take another look at the marketplace. Just like your clients see the value in outsourcing recruiting services, today’s companies are also seeing the value in outsourcing the back office services on W2’s. This is a prime time opportunity for independent recruiting and staffing firms to be ready to market contract staffing services to their new and existing clients.

The bottom line is that contract staffing is only growing, it’s extremely profitable and it’s easy to add to your current recruiting firm’s services.

There’s hardly ever been a better, or busier, time to be a recruiter in America. With a 16-year low unemployment rate and a record-high number of job openings, the demand for recruiting and staffing services is strong as this candidate driven market rolls on.

SIA just announced US staffing market predicted to grow 3% in 2018 to $126.8 billion. Total US staffing market — which includes temporary staffing as well as place and search — will rise by 3% both this year and in 2018, bringing total revenue in the industry to $145.1 billion next year, according to a new industry forecast by Staffing Industry Analysts. However, with a stronger recovery projected for place and search, the overall staffing market is likely to achieve 4% growth to reach $146.6 billion. Other positive economic factors include cutting the corporate business tax from 35% to 20%. “Despite the somewhat slower growth, the staffing market is on track to hit record size in terms of revenue in the next two years,” said Barry Asin, President of SIA. Online staffing will reach $5 billion in annual spend in 2018 from $1 billion in 2012.

Independent recruiting and staffing firms need to be prepared for the temp/contract staffing boom. If you’re not running contract/temp in your business then you need to add it to your services so you can become a full service recruiting firm for your client base and substantially increase revenue. If you’re already running both contracting and direct hire, make sure your you’ve partnered with a full service single solution back office provider who guarantees the highest profit per hour, features your brand on all forms and client and candidate communications as well as provides extensive value added services to help your business grow.

“Contracting,” “contract to hire” or “contract to permanent” placement scenarios are terms that are being spoken about more and more in today’s marketplace and it’s time to get familiar with it because it’s not going away. Often times, contract to hire is pushed by many recruiting agencies because it can be more profitable than simply placing someone directly with the company and charging a percentage of their salary.

Contract staffing opportunities exist in all verticals from entry level positions, management to executive level jobs. If you think temp/contracting is only for admin or warehouse jobs then you need to take another look at the marketplace. Just like your clients see the value in outsourcing recruiting services, today’s companies are also seeing the value in outsourcing the back office services on W2’s. This is a prime time opportunity for independent recruiting and staffing firms to be ready to market contract staffing services to their new and existing clients.

The bottom line is that contract staffing is only growing, it’s extremely profitable and it’s easy to add to your current recruiting firm’s services.

Outsourcing (also sometimes referred to as “contracting out”) is a business practice used by all companies to reduce costs or improve efficiency by shifting tasks, operations, jobs or processes to an external contracted third party for a significant period of time. The functions that are contracted out can be performed by the third party either onsite or offsite of the business.

Outsourcing can free up cash, personnel, facilities and time resources for a staffing firm. It can result in cost savings from lower labor costs, taxes, energy costs and reductions in the cost of services. In addition to cost savings, a staffing firm may also employ an outsourcing strategy in order to focus on its core business competencies. This allows the company to devote more resources to client development and candidate sourcing, which can improve efficiency and increase its competitiveness. A company may also choose to outsource in order to avoid government regulations or mandates, such as environmental regulations or safety regulations and requirements.

The ‘non-core’ functions of recruiting and staffing services, which includes back office services, should be outsourced to a back office organization for whom that function is their core business competency, further benefiting the business through the improved management of those functions. The right back office partner will handle your full back office requirements from A to Z including employer of record, payroll services, funding, onboarding, benefits, reporting, etc. Your back office partner will remove the financial risk, liability and headache of running full back office services. This solution should be delivered under your company branding by a trusted back office provider with decades in the industry.

Recruiting and staffing firms are hired to find the best candidates for client companies and to do so in the shortest amount of time possible with little to no headache on the part of the client. This is why they pay fees ranging from 20% to 30% of the first year’s compensation. But do to the high demand and complex nature of contract staffing, it’s important that recruiting and staffing firms have a reliable go to partner to handle your back office solution for your clients under your companies brand.

Do not be concerned about how you will explain your back-office partner to your client companies. Like you, they utilize outsourcing in their own business to run more efficiently therefore this concept will never fall on deaf ears. Simply explain to your company client that your staffing firm utilizes a back office partner who’s core competency is devoted to running back offices services for your firm and who is exclusive to the recruiting and staffing industry. Let them know that you will remain their main point of contact for all their recruiting and staffing needs.

The right back office partner will work seamlessly with your recruiting and staffing business utilizing a recruiter centric approach that will allow you to maintain full control and identity in the eyes of your company clients.

The staffing industry, comprised of more than 20,000 staffing firms and nearly 15 million staffing employees, contributes $150 billion to the U.S. economy through temporary and contract staffing, recruiting and permanent placement, outsourcing and outplacement, and human resource consulting.

Every day and in virtually every place that people work, staffing businesses send more than three million employees to work in America across all industries. Since 2009, this is a segment of third party recruiting that continues to grow and evolve. If you haven’t yet added contract staffing services to your business, here are four reasons why you should reconsider.

1. Increase Annual Revenue. Isn’t this the bottom line to any business? Saying yes to contract staffing is saying yes to more sales and profitability. With the increased demand for contract staffing with no end in sight, it’s time to stake your claim.

2. Be a Full Service Agency. If it hasn’t already happened then it’s just a matter of time before your direct hire clients ask you to fill a contract staffing need. Not to mention all the staffing openings you are not asking for and missing out on. The ability to offer your clients retained, contingency and contract staffing makes you a triple threat and a greater asset to your clients.

3. Become Recession Proof. We all remember 2009, even though we would all like to forget. The fact is our economy is cyclical and in down times contracting is the go to choice for many companies across all industries and can be the difference between a good year and a bad year.

4. Sell your firm for more money. The earlier you start building your contract staffing pipeline the more time you have to grow your contracting book of business. This can be a major revenue source when you’re ready to sell your business.

Companies depend on staffing employees to get through busy seasons and to support major projects, new clients, and business growth. The flexibility staffing provides gives companies a competitive edge in matching resources and payroll to the needs at hand. More and more, companies are placing an increased premium on more flexible and agile workforces—and staffing plays a vital role in that strategy.

Time has shown that contract staffing isn’t just good for our economy; it is an essential part of the recruiting industry that provides vital flexibility and support to businesses, and opportunities and flexibility for employees. And as the economy continues to evolve, with information and connectivity coming to dominate its core, the contract staffing market will continue to pay dividends to all recruiting firms who say yes to contract staffing.

The best news is that it’s easy to add to your current services using a turn-key back office partner that will handle all the financial risk, liability and headaches while you enjoy the four benefits we’ve discussed. There is no better time to say yes to contract staffing!

Most independent recruiters and staffing firms make the understandable decision to outsource their back office payroll services to a reputable provider. This eliminates the cost, risk and time associated with running your own payroll services. We all know that outsourcing back office tasks allows you to devote more of your time and energy to revenue generating activities that creates more income for your business. Make sure to shop around as you will discover that not all comprehensive contract staffing services are created equal.

The right payroll partner can make the difference between success and failure for your business. Protect your enterprise by paying particular attention to the following three important guidelines.
1. Make sure your payroll provider is giving you the highest profit per hour.

It sounds obvious but, unfortunately, many recruiters do not take enough time to do the research. Thoroughly investigating each option to pinpoint the provider who delivers the best profit per hour rate is critical. Anything less ends up costing you plenty of money over time. Look for a reputable provider who offers a free estimate and provides a best rate guarantee. Why pay more for the same service from anybody else?

Also, make sure that your providers are able to customize a contract staffing package. It should be flexible enough to keep pace as your business grows. Most payroll providers only offer a one-size-fits-all package that is likely to cost you money in the long run.

As an independent recruiter, it is critical that you work with a payroll provider who is on the same page. That means a firm that works exclusively with staffing firms like yours. Only such a provider can understand the unique aspects of your business profile. The firm can set up services to accommodate your unique professional needs and operate in synchronicity with your enterprise. Would you choose a Kia mechanic to service your Ferrari? Of course not!

Another important consideration that business owners tend to overlook is conflict of interest. Larger payroll providers work directly with clients, which means that they are also in competition with you. Keep in mind that bigger service companies are not always better.
3. Get a FREE suite of professional-grade recruiting tools, training & services.

Contract staffing services have evolved. Gone are the days of offering only payroll services. A cutting-edge back office provider will deliver a complimentary suite of feature-rich tools, services and training designed to propel your bottom line. If you’re not getting great complimentary tools, then it might be time to start shopping for a new provider.

Make sure that the firm you select for payroll processing also specializes in handling all of the other back office tasks you might need as your business grows. Strategic branding, marketing literature, search tools, ongoing training, national conferences, discounts on top name services and job placement are just some of the extras that a full-service back office outsource firm can offer.

Final thoughts

Even though you only need payroll assistance at present, don’t make the mistake of limiting your outsourcing options in the future. Once you have established a good working relationship with your provider, you may decide to turn over more of your daily office tasks to free up your time.

Contract payroll service is a growing industry that offers many options for businesses. Due to the competitive nature of this developing field, you are likely to find some significant differences in the types of services and pricing currently available.

By understanding your own payroll service requirements as a business owner and thoroughly investigating what several providers offer, you save yourself time, money and worry in the future. Opt for a payroll provider that delivers the highest profit per hour. Choose the provider that best understands and meets your specific payroll funding and processing requirements. Insist on additional tools and services at no cost.

Independent staffing professionals outsource their back office payroll services because of the cost, time, resources and liability associated with running employer of record services. They realize that their time is better spent focusing on revenue generating activities such as sales and sourcing while a reputable back office partner handles all the funding, insurance and admin of contract staffing. Unfortunately, too many independent staffing professionals do not realize the vast differences between back office providers.

The right payroll partner can be the difference between success and failure. Asking the below three questions will help you choose the right back office payroll partner to ensure the success of your staffing business.

1. Do they guarantee the best profit per hour rate in the industry?

You’ve worked hard selling your staffing services to companies and just as hard sourcing the right candidates for the positions. So why would you settle for less profit per hour when given a choice between reputable back office partners? Most reputable payroll providers who have been in business for 15 plus years are more than equipped to handle your back office functions so why would you opt to earn less per hour with nothing in return? Let’s face it, in this new economy, you must make every dollar count, therefore demand your back office provider guarantee the highest profit rate for every hour on every temp you run and get it in writing.

Also, make sure that your provider is able to customize a contract staffing package. It should be flexible enough to keep pace as your business grows. Most payroll providers only offer a one-size-fits-all package that is likely to cost you more money in the long run.
2. Do they offer a FREE suite of professional recruiting tools, training & services?

Most established back office services offer the standard services so not much sets them a part. Wrong! Gone are the days of offering just payroll services. A cutting-edge back office provider will deliver a complimentary suite of feature-rich tools, services and training designed to propel your bottom line. If you’re not getting complimentary value added services, then you need to continue your search for the right provider.

The right back office partner will go beyond traditional back office services by delivering additional front and back office services you will need as your business grows. Strategic branding, marketing literature, search tools, ongoing training, national conferences, discounts on top name services and job placement are just some of the extras that a full-service back office partner can offer.
3. Are they exclusive to independent staffing professionals?

As an independent staffing professional, it is critical that you work with a payroll provider who caters exclusively to the staffing industry and your confidential client needs. Why? Only a payroll partner exclusive to the staffing industry will be strategically designed to implement all the unique aspects of a staffing business. Wouldn’t you prefer a partner who can accommodate your unique professional needs and operate in synchronicity with your business? Working with a general payroll partner who will work with anyone including your clients would be agreeing to the idea that one size fits all.

Another important consideration that business owners tend to overlook is conflict of interest. Larger payroll providers work directly with clients, which means that they are also in competition with you.

In Conclusion

Contract payroll service is a growing industry that offers many options for staffing businesses. Due to the competitive nature of this developing field, you are likely to find some significant differences in the types of services and pricing currently available.

By understanding your own payroll service requirements as a staffing business owner and thoroughly investigating what several providers offer, you save yourself time, money and disappointment in the future. Opt for a payroll partner that delivers the highest profit per hour. Choose a partner who offers additional tools, services and training at no cost. Insist on a partner who has designed their back office services exclusively around your staffing business.